Confederation of British Industry (CBI) director general Richard Lambert has leapt to the defence of the private equity sector, following criticism from trade unions about job cuts at the firms they take over.

Criticism of the role played by private equity has grown in the wake of job losses at the likes of the AA and Bird’s Eye. Angered by ‘this down-sizing’, union leaders have called on ministers to scrap tax relief for interest payments on loans often used to fund takeovers.

However, Lambert lauded private equity companies for boosting performance of the businesses they take over, and while acknowledging the need for a debate, described the contribution of private equity as ‘almost entirely beneficial’. In a speech in London, he said such firms had a good jobs creation track record as well as a vested interest in the long-term health of businesses they owned. ‘None of this squares with the allegations of robbery and plunder,’ he said, ‘and in most cases businesses have emerged from private equity ownership a whole lot more healthy than they were when they went in.’

Elsewhere Permira boss Damon Buffini has pledged to meet AA union leaders to address their concerns, stating he wants a constructive relationship with them while accepting there was some confusion and apprehension about the motives and actions of private equity players.

‘As a result of the investments we’ve made,’ he said, ‘the futures of numerous companies across the UK and Europe have been secured and strengthened’.